28 February 2025 – Prices for Indonesian nickel ore have risen again this week. In addition, the Indonesian government’s new foreign exchange control on natural resources is likely to have a further impact on commodity prices.
Nickel ore prices in Indonesia up 4% on Friday
Indonesian nickel ore prices rose again today, Friday. Nickel ore with a 1.2% Ni content rose by 4.0%, while ore prices with a 1.6% Ni content rose by 3.4%. These price increases also had a direct impact on the important stainless steel raw material nickel pig iron, which rose by around 1.0% compared to the previous week.
The Indonesian nickel industry has been struggling with growing challenges for some time now, including limited mining quotas and declining ore quality. Last year, some smelters already had to resort to ore imports from the Philippines to cover their needs. From mid-2025, the Philippines is also expected to announce an export ban on nickel ore.
Indonesia introduces new foreign exchange controls for natural resources
A few days ago, the Indonesian government announced a new law that obliges exporters from the mining, plantation, forestry and fishing sectors to deposit 100% of their foreign exchange earnings in special accounts at state banks for 12 months. The only exception: oil and gas exports were exempted from this regulation.
This is intended to increase the country’s foreign exchange reserves to up to USD 100 billion and stabilise the rupiah – this is the declared aim of the Indonesian government. The rupiah had recently weakened significantly against the US dollar.
Will imported raw materials and equipment for nickel mining now become more expensive?
Even if further processed nickel products are not directly affected by the currency controls, analysts expect this to have an impact on commodity prices. This is because imported raw materials and equipment for nickel mining are likely to become more expensive as a result of the new legislation, which could slow down investments and delay projects. An adjustment in exchange rates is also likely to have an impact on commodity prices.
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